LITHIA MOTORS INC (LAD) Stock Fundamental Analysis
USA - NYSE:LAD - US5367971034 - Common Stock
320.96 USD
+0.11 (+0.03%)
320.96 USD
0 (0%)
LAD gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. While LAD is still in line with the averages on profitability rating, there are concerns on its financial health. LAD is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
LAD had positive earnings in the past year.
LAD had a positive operating cash flow in the past year.
In the past 5 years LAD has always been profitable.
In multiple years LAD reported negative operating cash flow during the last 5 years.
1.2 Ratios
The Return On Assets of LAD (3.69%) is better than 64.75% of its industry peers.
LAD's Return On Equity of 12.75% is fine compared to the rest of the industry. LAD outperforms 69.67% of its industry peers.
LAD's Return On Invested Capital of 5.61% is in line compared to the rest of the industry. LAD outperforms 59.84% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for LAD is below the industry average of 11.93%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.69% | ||
| ROE | 12.75% | ||
| ROIC | 5.61% |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.4%
ROE(5y)18.55%
ROIC(3y)7.58%
ROIC(5y)8.54%
1.3 Margins
Looking at the Profit Margin, with a value of 2.40%, LAD is in the better half of the industry, outperforming 63.93% of the companies in the same industry.
LAD's Profit Margin has been stable in the last couple of years.
LAD has a Operating Margin of 4.53%. This is in the better half of the industry: LAD outperforms 66.39% of its industry peers.
LAD's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 15.45%, LAD is doing worse than 86.07% of the companies in the same industry.
LAD's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.53% | ||
| PM (TTM) | 2.4% | ||
| GM | 15.45% |
OM growth 3Y-15.89%
OM growth 5Y2.61%
PM growth 3Y-21.85%
PM growth 5Y0.64%
GM growth 3Y-6.17%
GM growth 5Y-0.01%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so LAD is destroying value.
The number of shares outstanding for LAD has been reduced compared to 1 year ago.
LAD has more shares outstanding than it did 5 years ago.
The debt/assets ratio for LAD is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.48 indicates that LAD is not a great score, but indicates only limited risk for bankruptcy at the moment.
LAD has a Altman-Z score (2.48) which is comparable to the rest of the industry.
LAD has a debt to FCF ratio of 42.52. This is a negative value and a sign of low solvency as LAD would need 42.52 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 42.52, LAD is in line with its industry, outperforming 48.36% of the companies in the same industry.
LAD has a Debt/Equity ratio of 1.95. This is a high value indicating a heavy dependency on external financing.
LAD's Debt to Equity ratio of 1.95 is on the low side compared to the rest of the industry. LAD is outperformed by 71.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.95 | ||
| Debt/FCF | 42.52 | ||
| Altman-Z | 2.48 |
ROIC/WACC0.62
WACC9.1%
2.3 Liquidity
LAD has a Current Ratio of 1.22. This is a normal value and indicates that LAD is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.22, LAD perfoms like the industry average, outperforming 40.16% of the companies in the same industry.
LAD has a Quick Ratio of 1.22. This is a bad value and indicates that LAD is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.29, LAD is not doing good in the industry: 79.51% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.22 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.72% over the past year.
Measured over the past years, LAD shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.64% on average per year.
Looking at the last year, LAD shows a quite strong growth in Revenue. The Revenue has grown by 10.11% in the last year.
Measured over the past years, LAD shows a very strong growth in Revenue. The Revenue has been growing by 23.35% on average per year.
EPS 1Y (TTM)7.72%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%30.11%
Revenue 1Y (TTM)10.11%
Revenue growth 3Y16.59%
Revenue growth 5Y23.35%
Sales Q2Q%3.8%
3.2 Future
LAD is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.12% yearly.
LAD is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.01% yearly.
EPS Next Y18.91%
EPS Next 2Y12.56%
EPS Next 3Y12.29%
EPS Next 5Y16.12%
Revenue Next Year3.66%
Revenue Next 2Y4.41%
Revenue Next 3Y6.54%
Revenue Next 5Y6.01%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.47, the valuation of LAD can be described as very reasonable.
87.70% of the companies in the same industry are more expensive than LAD, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of LAD to the average of the S&P500 Index (27.86), we can say LAD is valued rather cheaply.
A Price/Forward Earnings ratio of 8.45 indicates a reasonable valuation of LAD.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LAD indicates a rather cheap valuation: LAD is cheaper than 90.98% of the companies listed in the same industry.
LAD's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.47 | ||
| Fwd PE | 8.45 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LAD is valued a bit cheaper than the industry average as 65.57% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of LAD indicates a somewhat cheap valuation: LAD is cheaper than 68.85% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.56 | ||
| EV/EBITDA | 8.54 |
4.3 Compensation for Growth
LAD's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as LAD's earnings are expected to grow with 12.29% in the coming years.
PEG (NY)0.5
PEG (5Y)0.46
EPS Next 2Y12.56%
EPS Next 3Y12.29%
5. Dividend
5.1 Amount
LAD has a yearly dividend return of 0.66%, which is pretty low.
LAD's Dividend Yield is a higher than the industry average which is at 5.56.
Compared to an average S&P500 Dividend Yield of 2.41, LAD's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
5.2 History
On average, the dividend of LAD grows each year by 11.85%, which is quite nice.
LAD has paid a dividend for at least 10 years, which is a reliable track record.
LAD has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.85%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
6.34% of the earnings are spent on dividend by LAD. This is a low number and sustainable payout ratio.
LAD's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP6.34%
EPS Next 2Y12.56%
EPS Next 3Y12.29%
320.96
+0.11 (+0.03%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners102.22%
Inst Owner Change-10.42%
Ins Owners0.88%
Ins Owner Change-0.38%
Market Cap8.23B
Analysts84
Price Target394.69 (22.97%)
Short Float %6.86%
Short Ratio5.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.66% |
Yearly Dividend2.1
Dividend Growth(5Y)11.85%
DP6.34%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.06%
Min EPS beat(2)-1.6%
Max EPS beat(2)9.71%
EPS beat(4)3
Avg EPS beat(4)5.43%
Min EPS beat(4)-1.6%
Max EPS beat(4)9.71%
EPS beat(8)4
Avg EPS beat(8)-0.11%
EPS beat(12)5
Avg EPS beat(12)-0.63%
EPS beat(16)8
Avg EPS beat(16)2.53%
Revenue beat(2)0
Avg Revenue beat(2)-2.19%
Min Revenue beat(2)-2.33%
Max Revenue beat(2)-2.05%
Revenue beat(4)1
Avg Revenue beat(4)-1.94%
Min Revenue beat(4)-3.72%
Max Revenue beat(4)0.33%
Revenue beat(8)1
Avg Revenue beat(8)-1.98%
Revenue beat(12)2
Avg Revenue beat(12)-2.05%
Revenue beat(16)5
Avg Revenue beat(16)-0.86%
PT rev (1m)-1.87%
PT rev (3m)-0.97%
EPS NQ rev (1m)0.26%
EPS NQ rev (3m)3.02%
EPS NY rev (1m)0.17%
EPS NY rev (3m)6.25%
Revenue NQ rev (1m)0.7%
Revenue NQ rev (3m)-0.66%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-1.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.47 | ||
| Fwd PE | 8.45 | ||
| P/S | 0.22 | ||
| P/FCF | 25.56 | ||
| P/OCF | 13.44 | ||
| P/B | 1.18 | ||
| P/tB | 4.72 | ||
| EV/EBITDA | 8.54 |
EPS(TTM)33.9
EY10.56%
EPS(NY)37.98
Fwd EY11.83%
FCF(TTM)12.56
FCFY3.91%
OCF(TTM)23.89
OCFY7.44%
SpS1449.13
BVpS272.48
TBVpS68.05
PEG (NY)0.5
PEG (5Y)0.46
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.69% | ||
| ROE | 12.75% | ||
| ROCE | 9.53% | ||
| ROIC | 5.61% | ||
| ROICexc | 5.67% | ||
| ROICexgc | 7.4% | ||
| OM | 4.53% | ||
| PM (TTM) | 2.4% | ||
| GM | 15.45% | ||
| FCFM | 0.87% |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.4%
ROE(5y)18.55%
ROIC(3y)7.58%
ROIC(5y)8.54%
ROICexc(3y)7.8%
ROICexc(5y)8.76%
ROICexgc(3y)10.26%
ROICexgc(5y)11.04%
ROCE(3y)12.38%
ROCE(5y)13.83%
ROICexcg growth 3Y-22.88%
ROICexcg growth 5Y-1.28%
ROICexc growth 3Y-24.14%
ROICexc growth 5Y-3.26%
OM growth 3Y-15.89%
OM growth 5Y2.61%
PM growth 3Y-21.85%
PM growth 5Y0.64%
GM growth 3Y-6.17%
GM growth 5Y-0.01%
F-Score6
Asset Turnover1.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.95 | ||
| Debt/FCF | 42.52 | ||
| Debt/EBITDA | 6.91 | ||
| Cap/Depr | 100.87% | ||
| Cap/Sales | 0.78% | ||
| Interest Coverage | 2.29 | ||
| Cash Conversion | 31.1% | ||
| Profit Quality | 36.14% | ||
| Current Ratio | 1.22 | ||
| Quick Ratio | 0.29 | ||
| Altman-Z | 2.48 |
F-Score6
WACC9.1%
ROIC/WACC0.62
Cap/Depr(3y)135.76%
Cap/Depr(5y)158.69%
Cap/Sales(3y)0.93%
Cap/Sales(5y)1.04%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)7.72%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%30.11%
EPS Next Y18.91%
EPS Next 2Y12.56%
EPS Next 3Y12.29%
EPS Next 5Y16.12%
Revenue 1Y (TTM)10.11%
Revenue growth 3Y16.59%
Revenue growth 5Y23.35%
Sales Q2Q%3.8%
Revenue Next Year3.66%
Revenue Next 2Y4.41%
Revenue Next 3Y6.54%
Revenue Next 5Y6.01%
EBIT growth 1Y4.38%
EBIT growth 3Y-1.94%
EBIT growth 5Y26.57%
EBIT Next Year17.12%
EBIT Next 3Y11.35%
EBIT Next 5Y11.07%
FCF growth 1Y135.41%
FCF growth 3Y-63.67%
FCF growth 5Y-28.69%
OCF growth 1Y194.86%
OCF growth 3Y-38.16%
OCF growth 5Y-4.12%